Financial Secretary Paul Chan on Monday said Hong Kong's economy would continue to grow despite the challenges brought by geopolitical tensions and changes in consumption patterns.

At a Legco panel meeting on financial affairs, Chan said growth in employment income and a recovery in the stock market should help increase private spending.

New People's Party lawmaker Adrian Ho asked what would be done to help the struggling retail sector after sales dropped in April.

The finance minister said the government was in talks with central authorities for measures to boost the local economy.

"We are indeed looking into increasing the duty-free allowances for visitors returning to the mainland right now. The HK$5,000 figure has been in place for quite some time. We have been liaising with the central authorities on this," he said.

"We have recently included eight other cities in the individual visit scheme, and we will seek to expand the scheme even further. While we do understand that we should have more such policy support in place, we should be prudent in the effects or potential impact of these measures."

Election committee lawmaker Tan Yueheng was concerned over whether there would be measures to reverse the trend of Hongkongers heading north to spend.

"It may be hard to compete in terms of prices, but we can enhance the quality of services in Hong Kong. So how can we promote two-way consumption to enhance the contribution of consumption to GDP in Hong Kong?"

In response, Chan said the city should look for ways to improve product and tourist experiences.

"We have our unique attractions. We never compete with others in terms of price. We compete with others in terms of the quality of services. We compete with others in terms of the quality of our goods and services and the experience we offer," he said.

"So I think various sectors, be it retail or catering, we all need to transform and enhance our competitiveness and increase the cost to value of their products."

The finance chief noted that property prices have stabilised after the scrapping of all "spicy" property cooling measures, adding the SAR would think of ways to avoid getting caught up in the cross-hairs of Sino-US tensions.